https://www.scmp.com/rss/13777/feed Richard Wong Yue-chim is the Philip Wong Kennedy Wong Professor in Political Economy at the University of Hong Kong en https://assets.i-scmp.com/static/img/icons/scmp-meta-1200x630.png https://www.scmp.com Under Hong Kong’s Tenants Purchase Scheme, introduced in 1998, 140,298 public rental housing units have been sold to existing tenants. Initially, about 57 per cent of the units available for sale found buyers and, in the past decade, this has increased to 72 per cent. By promoting home ownership, the scheme has increased the labour force participation rate and decreased unemployment among families that have bought these units. But there have been two other important effects. The scheme has also... https://www.scmp.com/comment/insight-opinion/article/3003251/hong-kong-can-ease-its-housing-crisis-helping-more-families?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/3003251/hong-kong-can-ease-its-housing-crisis-helping-more-families?utm_source=rss_feed Tue, 26 Mar 2019 05:00:11 +0000 The Tenants Purchase Scheme (TPS) was introduced in 1998 to help achieve the government’s policy goal of 70 per cent home ownership in Hong Kong. Since then, 140,298 units have been sold to sitting tenants, representing a substantial stock of public assets worth at least HK$300 billion – an amount much larger than the construction cost of the Sha Tin-Central railway. It has also had another effect – on the labour market. Census statistics help tell the story. The 39 public housing estates... https://www.scmp.com/comment/insight-opinion/hong-kong/article/2187730/solve-uniquely-hong-kong-conundrum-let-all-public?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/hong-kong/article/2187730/solve-uniquely-hong-kong-conundrum-let-all-public?utm_source=rss_feed Wed, 27 Feb 2019 01:04:20 +0000 A stable, nourishing family is an important bedrock for a child’s future achievement in life. Numerous studies have shown how the family environment is key to a young child’s future schooling achievements, earned income, mental health and many other measures. A lot of the focus has been on early childhood. But parental involvement is also critical for teenagers. Teenagers learn from their parents. The mother’s role is particularly important for human capital development. A mother’s education... https://www.scmp.com/comment/insight-opinion/hong-kong/article/2183959/poor-young-and-lacking-fathers-influence-how?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/hong-kong/article/2183959/poor-young-and-lacking-fathers-influence-how?utm_source=rss_feed Tue, 29 Jan 2019 06:00:30 +0000 The recent Hong Kong Poverty Situation Report 2017 announced that 1.37 million people are living below the poverty line, 25,000 more than in 2016. The poverty rate thus rose 0.2 percentage points to 20.1 per cent. After government cash transfers – including the Old Age Living Allowance and Low Income Working Family Allowance – are factored in, the poverty figure fell to 14.7 per cent, or 1.01 million, a rate similar to the previous year. Critics have responded by blaming the government for not... https://www.scmp.com/comment/insight-opinion/hong-kong/article/2175131/how-hong-kongs-poverty-line-skewed-elderly?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/hong-kong/article/2175131/how-hong-kongs-poverty-line-skewed-elderly?utm_source=rss_feed Tue, 27 Nov 2018 04:00:15 +0000 Ideas can be embodied in human capital in ways that augment a person’s productivity. They can also be embodied in material capital, such as physical assets to boost productivity. But increasingly the most valuable forms of capital are intangibles ones that are not embodied in man, machine, or structures – they are disembodied. Successful economies and companies are now increasingly rich in intangible capital. The intangible capital-rich economy is driven by ideas. Paul Romer, this year’s Nobel... https://www.scmp.com/comment/insight-opinion/hong-kong/article/2170693/how-new-economy-ideas-widens-social-inequality-and?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/hong-kong/article/2170693/how-new-economy-ideas-widens-social-inequality-and?utm_source=rss_feed Tue, 30 Oct 2018 04:00:45 +0000 Since the 18th century, when the Industrial Revolution started in England, to 1990, business investment centred on the acquisition of real, tangible assets, such as machines, tools, computers or office buildings. But, since then, investment in intangible assets – ideas, designs, research, specific human capital, client networks and the like – has been growing. This change has far-reaching significance. Not only are the economic properties of the two different, but many statistical metrics do not... https://www.scmp.com/comment/insight-opinion/united-states/article/2165541/what-apple-and-airbnb-have-common-intangible?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/united-states/article/2165541/what-apple-and-airbnb-have-common-intangible?utm_source=rss_feed Tue, 25 Sep 2018 04:15:30 +0000 A tenant assigned to a public rental flat in Hong Kong can pretty much stay there either until he dies, trades up to a subsidised Home Ownership Scheme flat or, on rare occasions, surrenders the flat because he has become well off. The lack of circulation of public rental flats has many negative consequences, particularly in the wake of escalating property prices. While attention has focused on taking steps to increase the housing supply, there is a more immediate measure that could be taken:... https://www.scmp.com/comment/insight-opinion/hong-kong/article/2161609/how-housing-supply-hong-kong-can-be-increased?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/hong-kong/article/2161609/how-housing-supply-hong-kong-can-be-increased?utm_source=rss_feed Tue, 28 Aug 2018 05:00:15 +0000 Chief Executive Carrie Lam Cheng Yuet-ngor has made home ownership, particularly subsidised public home ownership, the centrepiece of her government’s public housing policy. This is very wise. She has carried it forward by proposing a Starter Homes Scheme, regularising the Green Form Subsidised Home Ownership Pilot Scheme (GSH), and increasing the discount on Home Ownership Scheme (HOS) sale flats from the present 30 per cent to 48 per cent off the market prices of private housing flats. There... https://www.scmp.com/comment/insight-opinion/hong-kong/article/2156575/singapores-public-housing-owners-have-one-major?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/hong-kong/article/2156575/singapores-public-housing-owners-have-one-major?utm_source=rss_feed Tue, 24 Jul 2018 22:02:11 +0000 The Task Force on Land Supply published its much-awaited report in April, and is now gathering public views on a menu list of land supply options. The report was disappointing on three counts. First, it did not outline a strategy for Hong Kong’s future development. The report appeared to be content with citing a projected shortfall of 1,200 hectares of land based on the Hong Kong 2030 Plus planning study. It provided little enlightenment on objectives, trade-offs and the way forward. Second,... https://www.scmp.com/comment/insight-opinion/article/2152392/building-more-flats-hong-kong-easy-hard-part-doing-it-vision?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/2152392/building-more-flats-hong-kong-easy-hard-part-doing-it-vision?utm_source=rss_feed Tue, 26 Jun 2018 04:03:34 +0000 People intuitively understand that building more private homes would not address Hong Kong’s immediate housing woes, for two reasons. First, a faster rate of housing production is simply not possible because land is not available at the moment. Second, high market prices make private homes unaffordable for almost everyone. Building, say, 30,000 or even 40,000 private units a year is unlikely to make private homes more affordable. Moreover, 80 per cent of all households have monthly incomes below... https://www.scmp.com/comment/insight-opinion/article/2148160/sell-public-housing-affordable-prices-help-hongkongers?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/2148160/sell-public-housing-affordable-prices-help-hongkongers?utm_source=rss_feed Tue, 29 May 2018 04:14:15 +0000 Hong Kong’s public housing policy was devised in the 1970s when the main housing problem was overcrowding in the private rental sector. Many of the tenants had very low incomes and it made sense for policymakers to focus on affordable low-rent flats.  By the 1990s, however, the situation had changed completely. The number of units per household among private renters had increased from 0.54 in 1971 to 1 in 1991. Overcrowding had mostly been eliminated and improved economic conditions had... https://www.scmp.com/comment/insight-opinion/article/2143103/how-privatise-hong-kongs-public-housing-and-satisfy-desire?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/2143103/how-privatise-hong-kongs-public-housing-and-satisfy-desire?utm_source=rss_feed Tue, 24 Apr 2018 09:14:20 +0000 The people of Hong Kong may have different views about many issues, but everyone agrees that the housing shortage is our biggest domestic problem. Many think the problem can only be resolved in a fundamental way by increasing housing supply. But such relief will take time. It takes over 10 years to reclaim land and develop residential flats, and nearly 10 years to convert agricultural land to residential use. Even among those favouring more building, there are differences about what kind of... https://www.scmp.com/business/companies/article/2139132/it-time-empower-welfare-housing-tenants-rent-out-part-or-all?utm_source=rss_feed https://www.scmp.com/business/companies/article/2139132/it-time-empower-welfare-housing-tenants-rent-out-part-or-all?utm_source=rss_feed Tue, 27 Mar 2018 08:57:21 +0000 I have written very little about Hong Kong’s fiscal role in the economy except to reaffirm the general soundness of positive non-interventionism in delivering inclusive economic growth and civil liberties. Many of my friends think this is my Chicago School bias. But intellectually I was not a capitalist as a student. I only became a convert after witnessing Hong Kong’s incredible economic success on the ground in the 1970s and some of the follies of government positive interventionism by our... https://www.scmp.com/business/global-economy/article/2134869/investing-human-capital-our-best-policy-option-cash-hand?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/2134869/investing-human-capital-our-best-policy-option-cash-hand?utm_source=rss_feed Tue, 27 Feb 2018 04:45:30 +0000 In recent months, if not years, there has been an unending stream of shrill press reports about housing prices scaling new heights, and the size of new private housing units shrinking to new lows. The small size of the units is an interesting question for economics. The trivial answer is that Hong Kong simply has a huge housing shortage that is expected to remain for some time, due to local and regional economic growth, favourable global macroeconomic conditions (like low interest rates), and a... https://www.scmp.com/business/china-business/article/2131152/lets-build-smaller-public-housing-not-bigger-and-hurry-and?utm_source=rss_feed https://www.scmp.com/business/china-business/article/2131152/lets-build-smaller-public-housing-not-bigger-and-hurry-and?utm_source=rss_feed Tue, 30 Jan 2018 03:48:40 +0000 Everyone in Hong Kong knows that there is a huge shortage of housing in the city. The government has been working very hard to increase supply and manage (or suppress) demand. But the effort has not yielded much success so far. Property prices and rents in the private sector have continued to soar, while the waiting list to get into public housing gets ever longer. The past decade has been a fascinating opportunity for students of economics to observe how a housing market adjusts to extreme... https://www.scmp.com/business/china-business/article/2125687/rethinking-hong-kongs-future-housing-policy-commitment?utm_source=rss_feed https://www.scmp.com/business/china-business/article/2125687/rethinking-hong-kongs-future-housing-policy-commitment?utm_source=rss_feed Tue, 26 Dec 2017 07:19:49 +0000 For many in Hong Kong our housing problem is high prices and high rents due to a shortfall in housing. They conclude that the most adversely affected are the low-income and middle-income households, therefore government must build more housing for these folks, which then means expanding public housing. But there is another way of viewing our housing problem. High prices are not bad news for homeowners and landlords, it is only for prospective homeowners and renters. Our problem is that 51.5 per... https://www.scmp.com/business/article/2121896/demand-welfare-housing-hong-kong-keeps-rising-and-we-should-beware?utm_source=rss_feed https://www.scmp.com/business/article/2121896/demand-welfare-housing-hong-kong-keeps-rising-and-we-should-beware?utm_source=rss_feed Tue, 28 Nov 2017 04:30:30 +0000 Hong Kong has a current labour force (not including foreign domestic helpers) of 3.64 million that is projected to peak in four years at 3.68 million. Thereafter, the workforce will continue to decline uninterrupted at an average annual rate of 0.36 per cent to 3.13 million by 2066. If this forecast comes true, surely the future of Hong Kong as an economic powerhouse is in jeopardy. Declining fertility rates have driven us into this dire state. But more importantly, a fortress mentality towards... https://www.scmp.com/business/article/2117741/hong-kong-must-drop-fortress-mentality-if-its-avoid-labour-crisis?utm_source=rss_feed https://www.scmp.com/business/article/2117741/hong-kong-must-drop-fortress-mentality-if-its-avoid-labour-crisis?utm_source=rss_feed Tue, 31 Oct 2017 05:07:57 +0000 Globalisation, since the collapse of the Berlin Wall, has had both supporters and detractors. Supporters credit it with bringing unprecedented prosperity to many parts of the world in the last quarter of a century and lifting 650 million people out of poverty. Detractors blame it for the slow income growth afflicting low- and middle-class workers in rich countries. Within economic policy circles, a graphic illustration nicknamed the “elephant chart” produced by former World Bank economist Branko... https://www.scmp.com/business/article/2113803/dont-blame-globalisation-stagnant-wages-rich-countries?utm_source=rss_feed https://www.scmp.com/business/article/2113803/dont-blame-globalisation-stagnant-wages-rich-countries?utm_source=rss_feed Tue, 03 Oct 2017 06:50:57 +0000 Hyper-globalisation has gripped the world since 1990, but we are only beginning to understand it. Hyper-globalisation differs from the old globalisation of 1820 to 1990, because it is happening at a much faster speed and has resulted in a much higher degree of global economic integration in the societies it has impacted. Whereas the old globalisation was driven primarily by declining transportation costs, the new hyper-globalisation is driven by the information and communications technology... https://www.scmp.com/business/global-economy/article/2109790/hong-kong-must-invest-knowledge-stay-relevant-hyper?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/2109790/hong-kong-must-invest-knowledge-stay-relevant-hyper?utm_source=rss_feed Tue, 05 Sep 2017 04:10:45 +0000 Last Saturday Andrew Sheng, writing in the South China Morning Post about Asia’s future in the next market adjustment, correctly pointed out: “Ultimately, demographics and geography determine destiny.” Hong Kong has the most robust market institutions in Asia for weathering the looming uncertainties in the global economic environment. It also has the right geography. But unfortunately it has poor demographics. The right geography is its location in the fastest growing area in the world. Between... https://www.scmp.com/business/article/2100195/how-hong-kongs-public-housing-policy-shuts-out-needed-skills-talent?utm_source=rss_feed https://www.scmp.com/business/article/2100195/how-hong-kongs-public-housing-policy-shuts-out-needed-skills-talent?utm_source=rss_feed Tue, 27 Jun 2017 08:23:43 +0000 In the twenty years since the establishment of the Special Administrative Region, Hong Kong has experienced slower economic growth and increased economic inequality compared to the previous twenty years. Why is that? Average annual GDP and GDP per capita increased, respectively, by 6.6 and 4.8 per cent in the period 1977-1997, but 3.2 and 2.6 per cent in 1997-2017. Among households with heads aged 20-65 years old, the Gini-coefficients on the distribution of household income (before government... https://www.scmp.com/business/china-business/article/2099161/blame-25-44-year-olds-slowing-hong-kongs-gdp-handover?utm_source=rss_feed https://www.scmp.com/business/china-business/article/2099161/blame-25-44-year-olds-slowing-hong-kongs-gdp-handover?utm_source=rss_feed Tue, 20 Jun 2017 07:45:00 +0000 After the 1967 Riots and with the arrival of Governor Murray MacLehose, more policies in support of the disadvantaged were adopted in Hong Kong. The great expansion of public housing was the centrepiece of MacLehose’s new policy initiatives. But this also presented considerable challenges for government in terms of land acquisition and finding the required resources. MacLehose correctly recognised that while the 1967 Riots were triggered by an industrial dispute, the public’s strongest... https://www.scmp.com/business/china-business/article/2098088/how-maclehose-shifted-priorities-resettling-squatters?utm_source=rss_feed https://www.scmp.com/business/china-business/article/2098088/how-maclehose-shifted-priorities-resettling-squatters?utm_source=rss_feed Tue, 13 Jun 2017 06:29:59 +0000 This year is the 50th Anniversary of the 1967 riots. The riots are popularly seen as a watershed event in Hong Kong’s post-war history, but they have hardly been thoroughly researched. What follows is a narrative of housing policy choices that I believe are important distant causes of the 1967 riots. Housing policy in Hong Kong in the past 70 years encountered several critical junctures that set us on paths of development leading to our present housing condition. At each of these junctures,... https://www.scmp.com/business/article/2097096/three-critical-hong-kong-housing-policy-decisions-ultimately-led-1967-riots?utm_source=rss_feed https://www.scmp.com/business/article/2097096/three-critical-hong-kong-housing-policy-decisions-ultimately-led-1967-riots?utm_source=rss_feed Tue, 06 Jun 2017 06:13:17 +0000 Poverty is a topic that occasionally makes headlines in the newspapers and attracts a variety of commentators. In a lot of these discussions reference is made to the poverty line as a measure of the extent of poverty in society. The poverty line is used in two senses: to denote absolute poverty and relative poverty. One of the Millennium Development Goals of the United Nations was to reduce the number of people in the world that are living in extreme poverty and hunger. The underlying conception... https://www.scmp.com/business/article/2096226/explaining-fine-line-between-absolute-and-relative-poverty?utm_source=rss_feed https://www.scmp.com/business/article/2096226/explaining-fine-line-between-absolute-and-relative-poverty?utm_source=rss_feed Tue, 30 May 2017 09:01:19 +0000 The Chinese Government’s 2017 work report announced that a plan will be drafted to develop the Guangdong-Hong Kong-Macao Greater Bay Area to give full play to the distinctive strengths of Hong Kong and Macau, and elevate their roles in the country’s economic development and opening up. Unlike previous initiatives under the banner of the Pearl River Delta and Pan-Pearl River Delta, this plan looks outward rather than inward. It stresses external links and securing a commanding position in global... https://www.scmp.com/business/article/2095350/opinion-china-needs-hong-kong-ideas-hub?utm_source=rss_feed https://www.scmp.com/business/article/2095350/opinion-china-needs-hong-kong-ideas-hub?utm_source=rss_feed Tue, 23 May 2017 06:53:09 +0000 We often hear laments that ‘housing is for living, not for speculation’ whenever demand increases faster than supply and speculation becomes rife in the market place. Faced with populist political pressure, governments look for quick fixes. They often deal with the symptom of housing price increases by suppressing demand and limiting speculation. Speculators are detested because most people simply reason that every housing unit they buy and hoard removes its immediate availability to those in... https://www.scmp.com/business/china-business/article/2094501/opinion-curbing-speculators-and-regulation-are-no-guarantees?utm_source=rss_feed https://www.scmp.com/business/china-business/article/2094501/opinion-curbing-speculators-and-regulation-are-no-guarantees?utm_source=rss_feed Tue, 16 May 2017 06:18:06 +0000 The emergence of outsiders Donald Trump and Bernie Sanders in last year’s US presidential election reflects the rise of right and left wing populist reaction to poor economic performance – both low productivity growth and high economic inequality. Economic factors may not be the only reason for the rise of populism in the US and around the world, but it is certainly a major part of the explanation. It is not without irony that the president of communist China is now championing a liberal world... https://www.scmp.com/business/article/2093523/links-between-global-integration-technological-advance-and-economic?utm_source=rss_feed https://www.scmp.com/business/article/2093523/links-between-global-integration-technological-advance-and-economic?utm_source=rss_feed Tue, 09 May 2017 08:26:10 +0000 The recent report on “Science, Technology and Mathematics Education” (or the Tsui Lap Chee Report) issued by the Academy of Sciences of Hong Kong finds our secondary school curriculum and university admissions criteria have under-emphasised science education, and that this will hamper prospects in the new economy. Another education failure, not the subject of the Tsui Report, is the underinvestment in senior secondary and tertiary education for at least two decades. This has been the leading... https://www.scmp.com/business/article/2092270/opinion-hong-kongs-science-students-shouldnt-be-strong-armed-liberal?utm_source=rss_feed https://www.scmp.com/business/article/2092270/opinion-hong-kongs-science-students-shouldnt-be-strong-armed-liberal?utm_source=rss_feed Tue, 02 May 2017 04:56:35 +0000 Since the introduction of the system of public accountability for principal officials, a majority of appointed policy secretaries have been recruited from the civil service. Former chief executive Donald Tsang Yam-kuen drew many of his policy secretaries from the civil service, and some expect that our next chief executive Carrie Lam Cheng Yuet-ngor will do the same. But the kitchen has become too hot for many prospective policy secretaries, especially those who are not civil servants. Policy... https://www.scmp.com/business/article/2090424/one-fix-would-quash-temptation-among-senior-civil-servants?utm_source=rss_feed https://www.scmp.com/business/article/2090424/one-fix-would-quash-temptation-among-senior-civil-servants?utm_source=rss_feed Tue, 25 Apr 2017 07:15:15 +0000 The housing malaise in Hong Kong is often seen as a problem of demand growing faster than supply. Government policy aims to firstly manage demand by discouraging transactions through high stamp duties and mortgage down payments in the shorter term, and secondly increase housing supply in the longer term. Accordingly, the housing malaise is interpreted as a straightforward problem of insufficient housing units. This appears to account for why existing housing units in the private sector are being... https://www.scmp.com/business/article/2088420/four-step-plan-how-privatise-our-welfare-housing?utm_source=rss_feed https://www.scmp.com/business/article/2088420/four-step-plan-how-privatise-our-welfare-housing?utm_source=rss_feed Tue, 18 Apr 2017 03:02:58 +0000 The most important source of growth in housing demand that has not been foreseen in Hong Kong is the rapidly escalating number of divorces and remarriages. This demand has meant many young adults cannot find affordable homes to set themselves up and start families, with the result they have grown increasingly frustrated. Hong Kong today has the fifth highest divorce rate in the world. Divorces and remarriages accelerated after China’s opening, which eased social interaction and led to an... https://www.scmp.com/business/companies/article/2086663/hk3tr-wealth-transfer-would-fix-our-broken-housing-policy?utm_source=rss_feed https://www.scmp.com/business/companies/article/2086663/hk3tr-wealth-transfer-would-fix-our-broken-housing-policy?utm_source=rss_feed Tue, 11 Apr 2017 04:30:11 +0000 Property prices in Hong Kong have again scaled new heights, demonstrating conclusively that regulatory constraints do not work. The scale of the shortage can be surmised by the gap in cumulative family formation numbers and new housing units completed over the past 20 years. The cumulative number of marriages in Hong Kong from 1986-2016 was 1.75 million. Over the same period, the cumulative number of new domestic housing units built was 1.57 million. Assuming demolished units amounted to about... https://www.scmp.com/business/companies/article/2084607/heres-where-we-can-find-land-help-solve-housing-crisis?utm_source=rss_feed https://www.scmp.com/business/companies/article/2084607/heres-where-we-can-find-land-help-solve-housing-crisis?utm_source=rss_feed Tue, 04 Apr 2017 04:10:54 +0000 Knowledge will be the key resource of society in the future. In rich countries, knowledge workers already make up half the workforce and are growing in numbers. What will this mean for society, politics and the economy? The impacts are likely to be greater in the social sphere than the economic one. The first thing to note about knowledge workers is that they are capitalists, because their specialised knowledge represents their human capital. High knowledge workers such as doctors, lawyers,... https://www.scmp.com/business/global-economy/article/2082707/avoiding-pitfalls-knowledge-based-society?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/2082707/avoiding-pitfalls-knowledge-based-society?utm_source=rss_feed Tue, 28 Mar 2017 04:35:52 +0000 Home prices in Hong Kong soared late last year, to the surprise of many, after falling by about 4 per cent between 2015 and 2016. Developers quickly pushed large numbers of pre-sale units onto the market at very high markups. The government responded quickly by slapping on an additional punitive stamp duty in a bid to cool down what was perceived as renewed speculative fervour. This was a mistake. There are no speculators or short- or medium-term investors in the property market anymore, only... https://www.scmp.com/business/article/2080754/how-stamp-duty-pre-sold-units-inflating-hong-kong-house-prices?utm_source=rss_feed https://www.scmp.com/business/article/2080754/how-stamp-duty-pre-sold-units-inflating-hong-kong-house-prices?utm_source=rss_feed Tue, 21 Mar 2017 05:18:04 +0000 The last time I commented on the budget speech of the financial secretary was more than two decades ago. The principles governing the postwar Hong Kong budgetary framework have been highly predictable since the time of Cowperthwaite and Haddon-Cave. It is a fundamentally sound framework that respects liberty, fosters prosperity for the population, and should not be tampered with out of ignorance or prejudice. There is of course still room for some necessary revisions to the budgetary framework.... https://www.scmp.com/business/article/2078698/conservative-budgeting-populist-world?utm_source=rss_feed https://www.scmp.com/business/article/2078698/conservative-budgeting-populist-world?utm_source=rss_feed Tue, 14 Mar 2017 06:54:43 +0000 Discussions over whether the pan-democrats should nominate and vote for establishment candidates in the Chief Executive elections have been intense. Last week an overwhelming number of them nominated John Tsang and Woo Kwok-Hing. Subsequently the pan-democrats decided to cast all their votes in favour of the candidate with the highest public poll standing. This is a major break with their past as it backs away from populist democracy and represents a significant step towards liberal... https://www.scmp.com/business/article/2076686/arrows-theorem-and-pan-democratic-vote-establishment-candidates?utm_source=rss_feed https://www.scmp.com/business/article/2076686/arrows-theorem-and-pan-democratic-vote-establishment-candidates?utm_source=rss_feed Tue, 07 Mar 2017 05:15:45 +0000 Economic liberty and political equality are two of the most important ideas that define modern civilization. The free market capitalist industrial economy is founded on the principle of economic liberty based on private property. The democratic political system is founded on the principle of equal political rights for all men (and women, of course) without privilege from birth. Yet these two important ideas have long shared an uneasy coexistence – with many believing free markets worsen... https://www.scmp.com/business/article/2074669/killing-mortgage-loan-market-has-worsened-inequality-eligible-households?utm_source=rss_feed https://www.scmp.com/business/article/2074669/killing-mortgage-loan-market-has-worsened-inequality-eligible-households?utm_source=rss_feed Tue, 28 Feb 2017 03:25:06 +0000 Hong Kong’s stellar growth of the past has slowed this century, resulting in a growing share of the younger population failing to prosper. What lessons from this past are worth sharing with our children as they try to figure out how to work towards a prosperous life? We know that a person’s prosperity depends on his starting position, work and savings behaviour, prudence in investment, and luck. These can be augmented by investing in four kinds of capital – business capital, financial capital,... https://www.scmp.com/business/article/2072553/investing-personal-and-social-prosperity-economists-view?utm_source=rss_feed https://www.scmp.com/business/article/2072553/investing-personal-and-social-prosperity-economists-view?utm_source=rss_feed Tue, 21 Feb 2017 04:12:31 +0000 Legislator Leung Kwok Hung (also known as Long Hair) has declared that he would seek nominations to become a candidate in the upcoming CE elections. Leung has urged his political allies not to vote for any pro-establishment candidates even if they are seen as “lesser evils”, as a matter of principle. In joining the race, Leung has reversed his political position in the previous two CE elections of “not voting, not nominating, and not running in any small-circle election.” His decision signals a... https://www.scmp.com/business/article/2070666/chief-executive-elections-and-hong-kongs-political-left?utm_source=rss_feed https://www.scmp.com/business/article/2070666/chief-executive-elections-and-hong-kongs-political-left?utm_source=rss_feed Tue, 14 Feb 2017 03:20:36 +0000 News of the disappearance of Chinese billionaire Xiao Jianhua from Hong Kong was widely reported in the media locally and internationally. Unconfirmed reports said he was abducted and whisked across the border over his business dealings with powerful figures in China who might have been targeted in the graft crackdown. Xiao’s disappearance has raised fresh fears about Beijing’s growing lack of respect for Hong Kong’s autonomy and independence in law enforcement. For wealthy businessmen from the... https://www.scmp.com/business/companies/article/2068772/chinese-billionaire-who-rides-tiger-can-never-get?utm_source=rss_feed https://www.scmp.com/business/companies/article/2068772/chinese-billionaire-who-rides-tiger-can-never-get?utm_source=rss_feed Tue, 07 Feb 2017 08:00:15 +0000 Over the past three decades, opinion polls have shown time and again that housing is the top policy concern of the public. Unfortunately, the housing challenge remains unsolved. I believe this is because we have tried to tackle it as a housing problem and failed to appreciate it is also a problem of economic inequality. Solving the housing challenge requires directly confronting the consequences of increasing economic inequality in a rising housing market. Increasing housing supply on its own... https://www.scmp.com/business/article/2066745/turning-hong-kongs-housing-challenge-housing-solution?utm_source=rss_feed https://www.scmp.com/business/article/2066745/turning-hong-kongs-housing-challenge-housing-solution?utm_source=rss_feed Wed, 01 Feb 2017 03:42:24 +0000 For many years, Oxfam has advocated pro-poor policies through its research, campaigns, public education, and support for local poverty programs. In Hong Kong, it has made good progress, evident in the establishment of the official poverty line, the enforcement of the minimum wage and a Low-income Working Family Allowance (LIFA), all of which it advocated. Some of Oxfam’s services are certainly very valuable, but its research is unfortunately wrong-headed. This makes its influence on policy and... https://www.scmp.com/business/article/2064919/plight-near-poverty-hong-kong-households-needs-be-addressed-within-next?utm_source=rss_feed https://www.scmp.com/business/article/2064919/plight-near-poverty-hong-kong-households-needs-be-addressed-within-next?utm_source=rss_feed Tue, 24 Jan 2017 05:45:30 +0000 The recent rise in political polarisation in Hong Kong and rich nations can be traced ultimately to rising economic inequality over the past three to four decades. One source of inequality is human capital investment. Those born into poor families cannot hope to get money to finance such investments. Government often subsidises education and health care to equalise access to this financing and correct imperfections in the capital market. The distribution of human capital in Hong Kong is evident... https://www.scmp.com/business/article/2062749/tackling-economic-inequality-best-way-sorting-housing-crisis?utm_source=rss_feed https://www.scmp.com/business/article/2062749/tackling-economic-inequality-best-way-sorting-housing-crisis?utm_source=rss_feed Tue, 17 Jan 2017 05:43:05 +0000 In October 2013, a month after the government’s Long Term Housing Strategy (LTHS) consultation document was released, I came to the conclusion that its estimate of a net annual increase of 29,400 new households in the decade 2015-25 had significantly underestimated future housing demand growth. Ever since then residential housing prices have continued to rise rapidly in spite of the imposition of hefty punitive stamp duties. This is strong evidence that my conclusion was correct. The prices of... https://www.scmp.com/business/article/2060814/societal-changes-will-continue-determine-hong-kongs-housing-demand?utm_source=rss_feed https://www.scmp.com/business/article/2060814/societal-changes-will-continue-determine-hong-kongs-housing-demand?utm_source=rss_feed Tue, 10 Jan 2017 04:30:15 +0000 The world has witnessed many black swans in the past year, most notably Brexit and Hillary Clinton losing the US presidential race to Donald Trump. A black swan, according to Nassim Taleb, requires three principal characteristics: It is unpredictable; it carries a massive impact; and, after the fact, we concoct an explanation that makes it appear less random, and more predictable, than it was. Many events would qualify as black swans by this definition – the astonishing success of Google and... https://www.scmp.com/business/global-economy/article/2058895/why-being-messy-best-way-deal-black-swan-events?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/2058895/why-being-messy-best-way-deal-black-swan-events?utm_source=rss_feed Tue, 03 Jan 2017 06:34:23 +0000 On November 7, the Chinese government’s National People’s Congress Standing Committee interpreted the provisions under Article 104 of Hong Kong’s Basic Law to resolve the oath-taking row that has befallen the city’s Legislative Council. Since the case was already before Hong Kong’s courts, it was felt that an NPC Standing Committee interpretation would undermine the city’s autonomy and confidence in separate legal system. The political reason for Beijing’s contentious interpretation is... https://www.scmp.com/business/article/2057386/hong-kongs-basic-law-according-theory-legal-origins?utm_source=rss_feed https://www.scmp.com/business/article/2057386/hong-kongs-basic-law-according-theory-legal-origins?utm_source=rss_feed Tue, 27 Dec 2016 04:30:11 +0000 The pan-democrats’ coalition successfully captured an estimated 325 of the 1,200 seats on the 2017 Chief Executive Election Committee. This is 50 per cent more than their share five years ago. In terms of Hong Kong’s political development, it is an important milestone towards building public accountability in the political order. In all past elections of the Chief Executive, the democratic opposition was politically irrelevant despite its considerable popular support. Its presence on the Chief... https://www.scmp.com/comment/insight-opinion/article/2055989/inclusiveness-might-be-more-important-democracy-hong-kong?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/2055989/inclusiveness-might-be-more-important-democracy-hong-kong?utm_source=rss_feed Tue, 20 Dec 2016 04:06:09 +0000 An estimated 36 per cent of Secondary Five students lack a sense of national identity, according to a recent study by the Hong Kong Policy Research Institute. Some blame it on the government’s failure to introduce national education into the school curriculum. Yet their parents, who were not exposed to national education under British rule, apparently have a stronger sense of national identity. Why the difference? The issue of national identity, or lack of it, among some of our young generation... https://www.scmp.com/business/article/2054151/solving-hong-kongs-national-identity-puzzle?utm_source=rss_feed https://www.scmp.com/business/article/2054151/solving-hong-kongs-national-identity-puzzle?utm_source=rss_feed Tue, 13 Dec 2016 03:35:57 +0000 Richard Wong Richard Wong The Cuban Revolution was an armed revolt by Fidel Castro’s 26th of July Movement and its allies against the authoritarian government of President Fulgencio Batista. The revolution began in 1953, and continued sporadically until Batista was ousted on January 1, 1959. The 26th of July Movement later reformed along communist lines, becoming the Communist Party in October 1965. These events reshaped Cuba’s relationship with the US. Before the revolution, Cuba was one of the US’s strongest allies.... https://www.scmp.com/business/article/2052134/cubas-sugar-exports-help-explain-rise-fidel-castro?utm_source=rss_feed https://www.scmp.com/business/article/2052134/cubas-sugar-exports-help-explain-rise-fidel-castro?utm_source=rss_feed Tue, 06 Dec 2016 04:32:25 +0000 Why Donald Trump? Why, for that matter, Bernie Sanders? Why did two economic populists from outside the American political mainstream set the tone for the recent presidential election? Part of the answer lies in stagnant economic growth (after 1970) and rising income and wealth inequality (after 1980). And those two trends are painstakingly outlined in a latest book on US economic history. Robert Gordon’s The Rise and Fall of American Growth (2016) shows that US labour productivity was at its... https://www.scmp.com/business/article/2050047/rise-and-fall-american-economic-growth?utm_source=rss_feed https://www.scmp.com/business/article/2050047/rise-and-fall-american-economic-growth?utm_source=rss_feed Tue, 29 Nov 2016 06:08:57 +0000